Investment consultants are likely to join private equity firms in a bidding war for the fund manager Russell Investments, which has reportedly been put up for sale by its US parent.

According to an intermediary approached for advice, at least two private equity firms are seriously interested in buying the firm, which provides investment consulting and asset management services to institutional clients.

An executive at one of the large UK investment consultants said: “If the auction progresses, we would certainly be interested in Russell. It would be a great consolidation opportunity.”

Mercer, owned by US-based Marsh McLennan, Aon Hewitt and Towers Watson have all expanded their consulting operations through mergers in previous years.

During the financial crisis, Russell hit problems with funds of hedge funds and money market funds. In 2012, it closed part of its exchange-traded-funds business following a lack of demand for certain products.